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Reserve Currency Collapse?

If you probe far enough into the apocalyptic economic literature of our times, you will find some writers warning that the US dollar is at risk of losing its place as the world’s reserve currency. Inflation, anemic economic growth and Ben Bernanke are the commonly cited catalysts for this coming event. So, is there good evidence this process has begun?

Not really:

Yes, there’s a slight downtrend for the dollar, and the Euro is making a corresponding movement up, but there’s nothing here to get panicked about. The Euro probably has as many fundamental problems as the USD, so there’s no reason to switch out your currency. Gold is being used as a store of wealth by large institutions, but it’s not passing regularly as everyday exchange for most people or businesses. There’s a case for investing in physical silver and gold, but an American reserve currency collapse isn’t part of it.

(And remember, in no way should you take financial advice from me, everything on the blog is for entertainment purposes only.)

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2 Responses

  1. I would have expected the Euro to show a bigger drop on that chart. What is holding the Euro value together? Certainly not Greece’s economy…

    • The short answer is probably “where else ya gonna go?”

      You can’t by a candy bar with silver, and every currency has its problems.

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